It seems a number of people think we're crazy for publishing expert advisors that utilise random entries. Here we will demonstrate why we humbly disagree with that assertion.
We think that the way a lot of other people go about backtesting is crazy. Here we will also demonstrate how we think backtesting should be done, and the many pitfalls that lie in wait for the unwary. Highfield pointed out some of the limitations of the MetaTrader 4 strategy tester in this post, but we'll use it for now since a lot of people are familiar with it. If you're not familiar with it you can get hold of a copy free of charge and then learn how to use it without using up any of your precious seed corn capital.
We published our first example robot back in April 2009. We just dusted it off and ran it through the MetaTrader 4 strategy tester. We used an FXDD demo account so beloved of the Forex Megadroid team. That's because FXDD haven't yet got floating spreads and 5 decimal places like many other brokers these days, which makes it easier for other people to duplicate our results. Since Cable has been doing well for us this year on our other systems we ran our backtest over the whole of 2009 on the GBP/USD currency pair. This is what the MetaTrader strategy tester showed us:
That's over 450% profit in a year. From the simplest "robot" we could devise this time last year, that stays in the market almost 100% of the time, and enters the market in the direction of the last tick.
Try it for yourself if you don't believe us: